Region-Beta Paradox
I came across the Region-Beta Paradox today.
As ever, full info is best found on the Wikipedia page but the TL;DR is that the Region-Beta Paradox describes a situation where a big setback can actually lead to a better outcome, sooner, than something more minor.
The logic is that the severity of the setback means that you have to fully reassess the option set before taking your next step in order to catalyse the process of recovery. A smaller setback, by contrast, is equivalent to the water slowly boiling the frog: it's not uncomfortable enough to really force change and action.
An example would be a job that is not really what you want to do with life, but is good enough: it pays the bills, you don't have to work too hard, etc. In that context, you may drift into 2, 3, 4 years of your life in a sub-optimal professional context just because the inertia to change is too strong. However, if you hate your job and your boss is a nightmare, the impetus to change can lead you to make a switch sooner, ultimately leaving you better off in the long-run (at least in theory).
It got me thinking about whether the same concept could apply to start-ups, and in particular, whether direct competition is something to embrace. Putting aside the Peter Thiel view of the world that competition is for losers (to which there is some merit - hence my push to Please Be Different), if you are already in a competitive market, I think the Region-Beta Paradox can apply.
Specifically, assume you are in the midst of building a pretty decent product. Most people would agree - if asked - that it's an improvement on what's out there today. It's growing nicely and overall you feel on top of things. Perhaps the ambition starts to fall a little - after all, you're doing a good job and "if it ain't broke, don't fix it", right? Perhaps the pace slows too - there's no point burning the midnight oil if things are largely on track.
Then you get hit in the face with a direct competitive punch in the face: an existential leapfrog moment. All of a sudden it's Code Red. There's no time to spare, you're already behind. On the back foot. All systems go.
Obviously the more peaceful situation is the former: where you can happily plod along with incremental improvements and slowly build towards a business of scale and significance. But the Code Red moment is by far the better route to greatness - towards the ambition of truly making a dent in the universe. And if you're a founder, I'll bet that's what you started on this journey to do, right?
So perhaps next time either happens to you - things feel too comfortable, or if you've just been kicked in the shins by a competitor - pause to think about what it means in the context of the Region-Beta Paradox. You might find it a helpful mental model to respond with power.
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P.S. I came across the concept - I'm somewhat embarrassed to admit - on an episode of the Diary of a CEO podcast, with his guest Chris Williamson. This was possibly the self-helpiest of self-help podcasts: an explicitly self-help episode inside a self-help podcast title. But to be honest, I loved the episode, and it's great to see two British lads kicking arse (spelling intentional) on the international podcast scene.